A lot of time is spent discussing rules and strategies about claiming Social Security to ensure you make the most of the program's benefits. But one feature of the program that might not get enough attention is spousal benefits.
Spousal benefits can be a lifeline for seniors who established a single-income household. Spouses who shortened their careers and stayed home to raise kids and manage a household can still receive a nice-sized monthly check thanks to spousal benefits.
But the rules are a bit different for spousal benefits than for personal retirement benefits. As such, it's important to know the details in order to make a smart claiming decision. Here are three things you absolutely must know before applying for spousal benefits.
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1. How your claiming age impacts your benefit
Just like when applying for personal retirement benefits from Social Security, when you claim spousal benefits can have a big impact on the size of your monthly check.
First, it's important to note the maximum spousal benefit is equal to half your spouse's primary insurance amount. That's the amount your spouse will receive if they claim at their full retirement age.
Just like personal retirement benefits, you become eligible for spousal benefits as early as age 62. But claiming before you reach your full retirement age will reduce your monthly benefit. In fact, the reduction in spousal benefits is greater than the reduction for claiming personal retirement benefits early. Additionally, unlike personal retirement benefits, there's no increase in spousal benefits if you claim after full retirement age.
Here's a table showing how much someone with a full retirement age of 67 (anyone born in 1960 or later) will receive in spousal benefits as a percentage of their spouse's primary insurance amount at different claiming ages.
| Claiming Age | Percentage of Spouse's PIA |
|---|---|
| 62 | 32.5% |
| 63 | 35% |
| 64 | 37.5% |
| 65 | 41.7% |
| 66 | 45.8% |
| 67 | 50% |
Data source: Social Security Administration.
2. How your spouse's claiming strategy impacts your spousal benefits
One key detail about spousal benefits is that in order to be eligible, your spouse must also actively collect benefits. It used to be possible for a spouse to apply for benefits and then suspend their application, but in most cases, the Social Security Administration now requires a person to actively receive benefits when someone else is claiming benefits based on that person's earnings record.
That can create a challenging situation for some couples. If the high-earning spouse is waiting to claim benefits to maximize their monthly check, it could mean the low-earning spouse receives a far smaller benefit or none at all while waiting. (Note: You can apply for personal retirement benefits and switch to spousal benefits after your spouse applies for Social Security.)
Oftentimes it makes sense for the high-earning spouse to wait until age 70 to increase survivor benefits. However, that might not always be the case if the low-earning spouse is significantly older or in poor health. Each situation is different, but it's important to consider how each spouse's claiming strategy will impact total household income.
3. You can receive spousal benefits even if you divorce
The requirements for spousal benefits extend to divorced spouses as well. As long as you were married for at least 10 years, you've been divorced for two years, and you don't remarry (or a later marriage ends in annulment, divorce, or death), you're eligible to collect benefits based on your ex-spouse's record.
Unlike spousal benefits for married couples, divorced spouses don't have to wait for their ex to start collecting benefits before they're eligible for spousal benefits. It's also important to note that claiming spousal benefits on your ex-spouse's record will have no impact on their benefits. Additionally, they'll have no knowledge of your claim.
Similarly, you can also collect survivor benefits based on an ex-spouse's record as long as you meet the 10-year requirement. In this instance, you may still qualify for survivor benefits even if you remarry assuming you do so after age 60.
It's important to consider those options, as they may be more valuable than any potential benefit based on your own earnings record.
